The effect of industry, region, and time on new business survival - A multi-dimensional analysis

We analyze the effect of industry, region, and time on new businesssurvival rates by means of a multi-dimensional approach. The data relateto West German districts in the 1983-2000 period. The survival chancesof start-ups tend to be relatively low in industries characterized by ahigh minimum efficient size and high numbers of entries. We find thatregional characteristics play a rather important role and thatintroducing the regional dimension leads to considerable improvements ofthe estimation results. The significance of the regional dimension isalso reflected in a remarkably high level of neighborhood effects.